British stocks drop with Chinese manufacturing

U.K. stocks slid the most in more than three weeks, led by commodity producers, as a private report showed that Chinese manufacturing expanded at a slower-than-expected pace last month.

BHP Billiton Ltd., Rio Tinto Group and Glencore Plc each dropped. Schroders Plc fell 3.9 percent after its assets under management missed some analysts’ forecasts. IAG SA added 2.3 percent as profit beat estimates. Smith & Nephew Plc rose 2.8 percent after the medical-device company’s revenue topped projections.

The FTSE 100 Index lost 61.99 points, or 0.9 percent, to 6,668.12 at 2:03 p.m. in London, extending its decline this week to 1.8 percent. The benchmark gauge today pared earlier declines of as much as 1.6 percent after a U.S. Labor Department report showed that employers added more than 200,000 jobs for the sixth straight month. The broader FTSE All-Share Index fell 0.9 percent, while Ireland’s ISEQ Index retreated 0.5 percent.

In China, HSBC Holdings Plc’s measure of manufacturing activity climbed to 51.7 in July, missing the median economist estimate of 52. The government’s purchasing managers index beat projections compiled by Bloomberg News.

BHP Billiton, the world’s biggest miner, lost 1.4 percent to 2,001 pence, while Rio Tinto fell 1.6 percent to 3,337.5 pence. Glencore slid 1.2 percent to 355.6 pence, and Randgold Resources Ltd. lost 1.7 percent to 5,035 pence.

U.K. manufacturing grew at the slowest pace in a year, a Markit Economics report showed. The PMI retreated to 55.4 in July, missing the median economist forecast of 57.2. Markit revised its reading for June down to 57.2.

Jobs report

A U.S. Labor Department report showed employers added 209,000 workers last month. While that missed a projection for 230,000 added jobs by economists, it was the sixth straight month that employers added more than 200,000 jobs, the longest such period since 1997 and a sign of growing optimism about the economic outlook. The unemployment rate rose to 6.2 percent, versus a forecast for the jobless rate to hold at 6.1 percent.

Schroders fell 3.9 percent to 2,297 pence. The U.K.’s largest publicly traded money manager said its assets under management increased 15 percent in the first half, less than some analysts’ had projected.

Man Group Plc declined 4.6 percent to 113.5 pence. Chief Executive Officer Emmanuel Roman said the world’s largest listed hedge-fund manager remains cautious about the second half of the year because of volatile markets.

International Consolidated Airlines added 2.3 percent to 338.4 pence. The parent of British Airways reported second quarter profit of 380 million euros, topping analysts’ estimates of 364 million euros. The company ordered a new fleet valued at $4 billion.

Smith & Nephew rose 2.8 percent to 1,055 pence. The company reported second-quarter revenue of $1.15 billion, beating analysts’ projections for sales of $1.13 billion. The maker of artificial hips and knees also repeated that its profit margin will exceed last year’s.

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